Identifying the Right Strategy to Manage Growth

In their research on “market-buster” strategies, Wharton management professor Ian MacMillan and co-author Rita McGrath identified various innovative methods that companies can employ to manage growth. When faced with multiple options, however, the question that confronts executives is deciding which strategy is right for their company.

According to MacMillan, choosing the appropriate strategy is hardly easy. “There's no one right answer,” he says in an interview with Knowledge@Wharton. “People might arrive at the same solution by using different tools.”

MacMillan does, however, offer some hints on how a company might go about identifying opportunities that point to growth. “One way to analyze the business world is to look for shortfalls and surpluses,” he says. “You might find a way of moving a surplus to where there's a shortfall. Somebody with economics training is likely to see that. Another way is to think about reduction of barriers, which is something an engineer might see. Economists see market opportunities, and engineers see physical and technical barriers. Depending on your training, two different lenses may be used to spot the same opportunity.”

Companies don’t necessarily need a large number of growth opportunities, MacMillan adds. “If you get a small team of people together and they know their industry well, you don't need 100 market-busters. You need one.”